Sonya used to earn $25,000 a year selling real estate, but she now sells greeting cards. The return to entrepreneurship in the greeting cards industry is

$14,000 a year. Over the year, Sonya bought $10,000 worth of cards from manufacturers and sold them for $58,000. Sonya rents a shop for $5,000 a year and spends $1,000 on utilities and office expenses. Sonya owns a cash register, which she bought for $2,000 with funds from her savings account.

Her bank pays 3 percent a year on savings accounts. At the end of the year, Sonya was offered $1,600 for her cash register.

Calculate Sonya’s explicit costs, implicit costs, and economic profit for the year.

Use the following information to work Problems 3 to 5.

Yolanda runs a bullfrog farm.When she employs 1 person, she produces 1,000 bullfrogs a week. When she hires a second worker, her total product doubles.

Her total product doubles again when she hires a third worker. When she hires a fourth worker, her total product increases but by only 1,000 bullfrogs. Yolanda pays $1,000 a week for equipment and $500 a week to each worker she hires.